Press Release

JCR-VIS Revises Fund Stability Rating of United Growth & Income Fund

Karachi, October 22, 2010: JCR-VIS Credit Rating Company Limited (JCR-VIS) has revised the Fund Stability Rating (FSR) of United Growth & Income Fund (UGIF) to ‘BBB+(f)’ (Triple B Plus (f)) from
‘A(f)’ (Single A (f)).

The revision in rating incorporates the heightened risk profile of the fund. Within the TFCs portfolio carried by UGIF, a sizeable amount of investments can be characterized as high credit risk. By virtue of its categorization as an Aggressive Income Fund, UGIF is allowed by policy to invest in sub-investment grade instruments as well; such investments however expose the fund to greater degree of credit risk.

Return of the fund in recent months has depicted considerable volatility on account of fluctuation in prices of TFCs, while some downside deviation in return has also been contributed by the provisions taken against non-performing assets. The 12-month rolling yield generated by UGIF has however consistently remained positive. Investors with long term investment horizon may benefit from enhanced yields by way of reversal of provisions against restructured assets, depending on the performance of such assets.

With significant redemption pressure faced over the last year, proportion of corporate debt instruments carried by the fund in relation to net assets has enhanced to almost 63% by end-September 2010. At present, the fund manager may have limited room to alter the asset allocation mix. While local secondary market for TFCs is already underdeveloped, marketability of non-performing and restructured instruments carried in the fund may be even lower. Liquid assets comprised 30% of net assets at end September 2010, providing some cushion in case of further redemptions in the fund. So far the fund has been able to meet its redemptions in a timely manner, without utilizing any borrowings. The AMC’s sponsoring bank continues to feature as the largest investor, with its percentage holding in the fund having increased over time.

For further information on this rating announcement, please contact Ms. Sabeen Saleem, CFA (Ext: 510) or Ms. Sobia Maqbool, CFA (Ext: 506) at 35311861-70 or fax to 35311872-3.



Faheem Ahmad
President & CEO

Information herein was obtained from sources believed to be accurate and reliable; however, VIS Credit Rating Company Limited (VIS) does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information.VIS , the analysts involved in the rating process and members of its rating committee do not have any conflict of interest relating to the rating(s)/ranking(s) mentioned in this report.VIS is paid a fee for most rating assignments. This rating/ranking is an opinion and is not a recommendation to buy or sell any securities. Copyright 2010 VIS Credit Rating Company Limited . All rights reserved. Contents may be used by news media with credit to VIS .